TrueCar does not misuse dealer data

Painter: "TrueCar's billing model is at the core of our value proposition."

To the Editor:

Selling cars is tough, and dealers are good, hardworking people doing all they can to make the car-buying process better. While car buyers believe dealers enjoy double-digit profit margins, new-car front-end grosses are less than 4 percent. TrueCar resolves that with a simple concept: Enable dealers to establish trust through accurate, up-to-the-moment market data and upfront vehicle-pricing information to reduce friction and sell more cars.

More than 10,000 TrueCar Certified Dealers know that works. So do more than 2 million consumers who since 2005 have bought vehicles from those dealers after engaging on the TrueCar platform (which includes hundreds of car-buying programs we operate for membership-based organizations such as USAA and Consumer Reports). Modern car buyers want transparency, and TrueCar Certified Dealers benefit by providing it, gaining an estimated 7 percent retail market share in their first full year after joining.

TrueCar's billing model is at the core of our value proposition: We invoice only if a TrueCar user buys a vehicle from a TrueCar Certified Dealer (in most states). In today's margin-compressed retail environment, dealers must hold the line on expenses and make their marketing accountable. At $299 per new car, TrueCar Certified Dealers pay less than half the $608 per-vehicle advertising expense that the National Automobile Dealers Association says the average dealership faced in 2014. Our long-term dealer partners understand that, benchmark all other marketing expenses against that and improve the overall efficiency of their sales teams and marketing budgets.

That level of accountability is possible because of our technology-enabled ability to accurately track purchases by TrueCar users from TrueCar Certified Dealers. That is the only reason we request certain consumer details and vehicle identification numbers -- to match TrueCar-user purchases and ensure that our dealers pay only for results. It's the core bargain. Don't pay for impressions; don't pay for subscriptions; don't pay for leads. Pay for results. What business owner wouldn't value that?

Some media reports have raised concerns about how we use data. The truth is TrueCar has requested the same data from our dealer partners for 10 years. We have never sold the data. We do not use the data for marketing.

Suggestions that TrueCar may misuse data are untrue and misleading.

We live in a time when we have the technology and systems to operate a fair, accountable and transparent marketplace -- one that works for modern car buyers and dealers alike. TrueCar Certified Dealers share our commitment to transparency because they know that it helps them establish trust with consumers and, ultimately, provides remarkable value. We're delighted to serve them.